You should be reported for this. Calling racism when there obviously isn't any is about as low as you can possibly go. What a pathetic crutch to have to use in an argument -- the racism card.
I understand what you're saying, the only thing i would disagree with is that these banks won't be able to raise capital because their stock price is going to go down regardless. I understand writing down these assets kind of creates a circular problem, but the underlying issue is still the fall of the real estate market.
trader, honestly I really don't care what you imply when you call me arrogant. I just find it funny that you think your limited knowledge of your first finance class years ago makes you feel superior to anyone discussing these issues when you've never really deomonstrated any understanding beyond the basics
Do we get to sell it at a profit???? I mean after the government does all the heavy lifting then should give it back to the same folx that *****ed it up in the 1st place and then allow them to profit from it without having to pay for their ***** ups? . . .. . nnnaaa. .. I am not into that plan Rocket River
Who is the "them" in this scenario? The owners of the company (shareholders) would be wiped out - so they lost everything. The management would all be fired and replaced, so they aren't getting anything back either.
Since when do you speak for the board. LOL....oh Georgie...you are slipping. So sad to see one sink so low from a mental health perspective.
You are giving it back to new folx. The current folx would lose all ownership in the banks. The government would neither take a loss nor a profit, as it is simply resolving them as the FDIC is supposed to do. That is the laws on the books, but the government is too scared because of the size of these banks. As it stands now, the government is taking huge losses by buying bank stock that is going down and guaranteeing or buying assets that are falling in value.
I am not sure whether or not you are a racist. Your use of "Balack" certainly is questionable though. And I don't think he called you a racist. I think he implies you make issue of his race do - and you do as proven by the example I have given you above.
I wouldn't go that far. We have a history with nationalizing things, and yet, nationalization still isn't the popular thing to do today: http://www.newsweek.com/id/183993 The truth is that the United States has a long and overlooked history of "nationalization," starting with the Northwest Ordinance of 1789, and then the Louisiana Purchase of 1803. Both acts put vast amounts of American territory in the public domain, at a time when land was far more valuable than currency. Even today, a third of all the land in the United States is still publicly owned, as are the continental shelves along our coasts, the airspace above us, not to mention hundreds of thousands of miles of roads and trillions of dollars' worth of other public infrastructure so essential to our private economy. In World War I, the nations' railroads were successfully nationalized to sustain the war effort. In the 1930s, the Reconstruction Finance Corp. bought millions of shares in over 6,000 banks in order to rescue them. During World War II, government took control of the economy's entire pricing system for consumer goods—a more complex job than taking over several big banks—and did quite well at it, most economists agree. In the 1980s, the Resolution Trust Corp. seized hundreds of failed savings and loans in order to save the system. After 9/11, the government effectively nationalized the private-security firms at airports, and replaced them with the federal TSA.
Do it, until they are solvent on their own....then let them go back to being private. Treat the bank the same way they treat your mortgage.....it is owned by the US government until the debt is paid.... What is good for the goose is good for the gander. DD
Actually, when I responded to TJ I wasn't concerned about commercial banks. I was refering to Investment Banks, but Major brought the discussion to commercial banks and that's fine. Now one thing I will conceded to not understanding is why a WAMU would even be holding Mortgage Back Securities other than what they are planning to sale. But if you look at WAMU's last 10K, we're talking about a $320BB bank with $20BB in MBS, so I wouldn't necessarily say that it is the write down of those assets that caused WAMU to fail.
See WAMU is both a mortgage loan originator and MBS broker/dealer. i.e. they issue loans to consumers and sell MBS on the market. Typically the issuer would retain the equity piece in house, which is the lower rating tranche, which in term is also the most likely to blow up. That plus WAMU being a market maker in MBS, would explain a big chuck of their MBS holdings.
